Too Much Testosterone Is Bad for Returns by Matt Levine

But now some cryptocurrency hedge funds have discovered selling, and even hedging, and a long/short strategy:

“You need to sit down and put a towel on your head and have a think about things,” said Lee Robinson, founder of Monaco-based hedge-fund firm Altana Wealth, whose $45 million cryptocurrency fund returned roughly 1,500% last year.

Mr. Robinson said he became concerned when the time taken for the price of cryptocurrencies to double was halving late last year, a sign the market was overheated.

He said the fund is now positioned to profit from price falls on stocks associated with bitcoin and blockchain technology, and cut back its bet on rising cryptocurrency prices.

I have to say, “our money keeps doubling twice as fast as it doubled before and it is making us nervous” is a really good problem to have as a hedge-fund manager. Most people running concentrated equity activist funds would kill for a problem like that. I guess that helps answer the question “why would anybody pay 20% fees for this?” Why would anyone pay 20 percent fees for anything else?